US tyre investigation is “dog in the manger” behaviour, says Chinese ministry

Moves by United States trade authorities towards reintroducing duties on certain Chinese tyres have been applauded by the union representing many US tyre industry workers, yet China says this not only contradicts international trade rules and national law, but any new antidumping or countervailing duties that emerge from current investigations will also fail to achieve their intended result.

On 15 July, the US Department of Commerce announced it had begun antidumping duty and countervailing duty investigations on imports of certain passenger vehicle and light truck tyres from the People’s Republic of China. The investigations are being carried out in response to a petition filed by the United Steelworkers (USW) union on 3 June; the US International Trade Commission is scheduled to make its preliminary determinations on the matter on 1 August, and should it decide that there is a reasonable indication that these imported tyres materially injure the US domestic industry or threaten material injury to it, the investigations will continue and the Department of Commerce will most likely make its preliminary countervailing duty determination in September 2014 and its preliminary antidumping determination in December 2014.

According to the USW, more than 50.8 million consumer tyres were exported from China to the US in 2013. When the union filed its petition last month, USW international president Leo W. Gerard stated: “Filing trade cases is not something we take lightly. We would prefer that countries live by the rules. But when our union members are injured, the Steelworkers act. We cannot stand idly by while China steals our jobs. Enforcing the rules is a fundamental prerequisite of the trading system, and China’s cheating is seriously undermining it.”

China’s Ministry of Commerce, on the other hand, opines that the USW petition contains “serious flaws” and is not supported by many tyre sector companies in the US. The ministry released a statement on 18 July in which it voices its “strong opposition” to an investigation it believes to be “in violation of WTO rules and US domestic law.” It also commented that prior antidumping measures implemented by the US failed to deliver any substantial benefits to the country’s domestic tyre industry – and therefore, as the ministry wrote, “restricting free trade and competition in the market through trade protectionist measures” such as this latest investigation is the “behaviour of a dog in the manger.”

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